G7 vows to assist Sri Lanka in securing debt relief; PM Wickremesinghe welcomes decision

Amid the ongoing economic crisis in the country, Sri Lankan Prime Minister Ranil Wickremesinghe on Friday welcomed the Group of Seven (G7) announcement to assist the island nation in securing debt relief. Notably, the G7 comprises the United Kingdom,  France, Canada, Germany, Japan, Italy, and the United States.

"I welcome the G7 announcement that they will assist Sri Lanka in securing debt relief. The continued engagement by the international community with Sri Lanka is key to overcoming the economic crisis," PM Wickremesinghe wrote in a Twitter post. 

Meanwhile, the Japanese government has pledged to donate USD 1.5 million (over Rs 11 crore) in aid to Sri Lanka through UNICEF. The fund would allow the UN agency to procure medicines for over 1.2 million people, including 53,000 pregnant mothers and approximately 122,000 children in immediate need. Charge d’ Affaires ad interim of Japan to Sri Lanka, Katasuki Kotaro, said that the medicines will be provided to health facilities across Sri Lanka in collaboration with the Ministry of Health.

"It is our great honour that Japan will be providing USD 1.5 million emergency grant assistance to the people of Sri Lanka to procure the most urgently needed 25 types of medicines within the next two months through UNICEF. We believe that this will help improve access to essential life-saving medical services, especially for pregnant women and children, who are most likely to be affected by the economic crisis," Kotaro noted, as per News First. 

Sri Lanka trying to negotiate loan with IMF amid worsening crisis

Earlier on May 18, Sri Lankan Prime Minister Wickremesinghe stated that the country has missed a payment to the Asian Development Bank (ADB), blocking the island nation from receiving new funds, amid concerns that the country's currency problem could be exacerbated. Notably, international sovereign bonds, commercial bank loans, Exim bank loans, and bilateral loans have all been suspended in Sri Lanka.

Amid the worsening crisis, Sri Lanka is now trying to negotiate a loan with the International Monetary Fund. This year, the country was required to pay USD 106.34 million, but only managed to USD 12.4 million by April.

Sri Lankan economic crisis

It is worth mentioning here that the Sri Lankan government has been struggling to meet basic requirements for its population of 22 million citizens amid an unprecedented economic crisis caused by mishandling of finances and ill-timed tax cuts. The island nation is also currently facing a foreign exchange deficit, which has resulted in food, fuel, power, and gas shortages, and has sought economic assistance from friendly countries. Meanwhile, recently-appointed Prime Minister Wickremesinghe has instructed his staff to cut off the expenses of the Prime Minister's Office (PMO) by 50%. 

(Image: AP)